Overview

• Guidelines from the Communist Party Central Committee and the State Council call for the national carbon market to cover major industries by 2027.
• Absolute emissions limits will be introduced in 2027 for industries with relatively stable carbon output, replacing solely intensity-based benchmarks.
• By 2030, policymakers aim to have a nationwide emissions trading scheme operating under absolute caps with a mix of free and paid allowances.
• The documents did not list specific sectors for the 2027 expansion, though analysts point to chemicals, petrochemicals, papermaking and domestic aviation as likely candidates.
• China’s ETS, launched in 2021 for power producers, has been constrained by generous free quotas; reporting indicates steel, aluminium and cement are slated to join this year under looser initial rules.